Institute for Certified

Frontline bookkeepers: What the cost of living means for accountancy professionals

@ICBUK

Rosalia Munro, Head of External Communications,

Institute for Certified Bookkeepers

Rosalia is an experienced communicator and is passionate about business and accounting issues, having previously held roles in small business policy and levelling up the accountancy profession at ICAEW.

As ICB’s Head of Communications, Rosalia supports the organisation in upholding the standards of the bookkeeping profession, helping businesses to succeed and operating for the benefit of the many.

Why bookkeepers are vital to supporting business through difficult economic times

Below: The Bookkeepers Summit 2019 T he pandemic, the war in Ukraine and surging

inflation; with all these having taken their toll on small business over the last year, you’d be forgiven for awaiting the arrival of the plague of locusts next. But what impact will that have on business? And how can accountancy professionals help to keep their clients afloat during this period of turmoil? Surging prices

When Russian tanks started to roll into Ukraine in February, it was clear that this conflict would have longer-term consequences for the economy. With Ukraine once being the ‘breadbasket’ of Europe, its invasion has had a huge impact on food prices across Europe, including in Britain. Trade sanctions and the confrontation between Russia and Western states has also created uncertainty around global gas and oil supplies, further increasing prices. Inflation in prices of everyday products will of course have an impact on small business’ bottom lines, creating concerns over viability.

consumer expenditure to have increased by 11% in the first quarter of 2022, as compared to the previous one. The cause of this spending? Essential items, such as utilities, food and transport. With “ICB bookkeepers costs increasing, and payroll experts consumers’ lack of are qualified and ready to rise to this disposable income could translate into a drop in sales for challenge” businesses, creating a challenge to their profits. The best way for a business to weather the coming storm is by enlisting the support of a trusted advisor with an indepth knowledge of its day-to-day finances, a skill that is ingrained into ICB bookkeepers from the earliest stages of their training.

Workers’ pay

Surging prices will deal businesses a second blow, however, with consumer spending likely to remain static. The figures bear this out, with Deloitte’s Consumer Confidence Index showing It’s not good news for HR departments or our friends in payroll either. The squeeze on workers’ personal finances will likely lead to demands for pay increases, and with the 1.25%

increase in National Insurance (NI), this is likely to further stretch company finances. Whilst it may be the case that the rise in NI is reversed with the change in Prime Minister, freezes on staff budgets will persist as long as the cost of living remains an issue. It will be for payroll and accountancy professionals to ensure that pay policies balance their client’s bottom lines whilst still enabling the retention of their employee base. ICB’s highlyqualified bookkeepers and payroll experts are qualified and ready to rise to this challenge, and can provide the guidance to ensure that businesses hold on to those all-important skills and headcount over the coming months.

A way forward?

With the economic outlook so uncertain, it is pivotal that businesses have access to the advice of trusted accountancy and payroll professionals and the right digital tools to enable them to stay abreast of their figures in real time. It is qualified bookkeepers, like ICB members that are best placed to help businesses navigate these difficult times with their day-to-day insight of their clients’ finances and their aptitude for software.

Reach out

Advisors can serve their clients by reaching out to them to understand their goals and concerns for the coming months and working with them to prepare for the potential downturn. Now more than ever, it is your knowledge that could save countless businesses and livelihoods from what is likely to be an exceptionally hard time.

Stay up to date

The most effective thing you can do to support your clients in this difficult environment, however, is simply to keep your skills and knowledge up to date. An understanding of legislative change, new software and technical updates from HMRC will provide you with all the information you need to provide the very best service to your clients. ICB’s programme of training and support is an excellent way of keeping you up to date and, in November, we will be hosting our premier CPD event, the Bookkeepers Summit. A two-day event taking place both in-person and online, the Summit has a packed agenda featuring practice advice, technical updates and talks from influential speakers. You will also have the opportunity to network with like-minded professionals and to meet with software providers and other vendors at our exhibition stands both in-person and online. Book today at www. bookkeeperssummit.com to avoid disappointment, using the code XUVIP to save £10 on the price of tickets.

Above: The Bookkeepers Summit 2019

FIND OUT MORE...

For more on the Bookkeepers Summit, visit:

bookkeeperssummit.com